Stocks Take Sharp Losses Monday 11/19 15:43
Big technology and internet companies tumbled again Monday, leading to broad
losses across the stock market.
NEW YORK (AP) -- Big technology and internet companies tumbled again Monday,
leading to broad losses across the stock market. The Dow Jones Industrial
Average briefly fell 500 points.
Apple, Microsoft and Amazon, the most valuable companies on the market,
sustained some of the worst losses. Facebook, another longtime investor darling
that has fallen out of favor since this summer, also skidded.
After a brutal October, stocks had started to recover early this month. But
continued losses for tech companies have sent major indexes lower again.
Mark Hackett, chief of investment research at Nationwide Investment
Management, said investors are dumping the high-profile technology companies
that have dominated the market recently. He said investors are picking
companies based on traditional profit and revenue figures instead of the kind
of user growth figures favored by tech companies.
"These things had outperformed the S&P by a mile over the last three years,"
he said, but that's changed now. "On good days they're not the leaders, and on
bad days they're the laggards."
The S&P 500 index fell 45.54 points, or 1.7 percent, to 2,690.73. The Dow
Jones Industrial Average sank 395.78 points, or 1.6 percent, to 25,017.44. It
was down as much as 512 earlier.
The Nasdaq composite skidded 219.40 points, or 3 percent, to 7,028.48. The
Russell 2000 index of smaller-company stocks lost 30.99 points, or 2 percent,
to 1,496.54.
Investors focused again on trade tensions between the U.S. and China after
the two countries clashed at a Pacific Rim summit over the weekend.
A steep loss for Boeing, a major exporter which would stand to suffer
greatly in a protracted trade war, weighed heavily on the Dow. Boeing gave up
4.5 percent to $320.94, but is still one of the best-performing stocks in the
30-stock index. Apple fell 4 percent to $185.86 on renewed worries that iPhone
sales could slow, Microsoft lost 3.4 percent to $104.62 and Amazon gave back
5.1 percent to close at $1,512.29.
High-dividend stocks like real estate companies and utilities, which
investors favor when they are fearful of market turmoil, held up better than
the rest of the market.
The disagreements between the U.S. and China at the Asia-Pacific Economic
Cooperation meeting left investors feeling pessimistic about the prospects for
a deal that would end the trade tensions between the world's two largest
economies. For the first time in almost 30 years, leaders at the summit could
not agree on a joint declaration on world trade.
Talks between the U.S. and China are continuing ahead of a meeting between
Chinese President Xi Jinping and President Donald Trump planned for the G-20
summit later this month.
Among tech and internet stocks, chipmaker Nvidia dropped another 21 percent
to $144.70. Nvidia said last week that it had a large number of unsold chips
because of a big drop in mining of cryptocurrencies. Facebook sank 5.7 percent
to $131.55 and Netflix lost 5.6 percent to $270.21.
The S&P 500 index of technology companies has now plunged 13.1 percent since
the end of September.
Nissan said its chairman, Carlos Ghosn, was arrested Monday and will be
dismissed from the company after allegedly under-reporting his income. Nissan
said an internal investigation found Ghosn under-reported his income by
millions of dollars and engaged in other "significant misconduct."
U.S.-traded shares of Nissan lost 5.8 percent to $16.90. In Paris, shares of
Nissan's partner Renault dropped 8.4 percent.
Industrial companies and retailers also stumbled. Caterpillar fell 3.1
percent to $125.98 and Nike lost 3 percent to $72.52.
Benchmark U.S. crude reversed an early loss and rose 0.5 percent to $56.76 a
barrel in New York. U.S. crude prices have dropped for six weeks in a row and
are trading around their lowest level in about nine months.
Brent crude, used to price international oils, was little changed at $66.79
a barrel in London.
Wholesale gasoline added 0.4 percent to $1.58 a gallon. Heating oil gained
0.6 percent to $2.09 a gallon. Natural gas surged 10 percent to $4.70 per 1,000
cubic feet.
The parent company of California utility Pacific Gas & Electric fell again
after it disclosed that it had a power line failure near the start of a deadly
wildfire the morning the fire began. The Mercury News of San Jose reported
Saturday that the company said it had an outage at 6:45 a.m. on Nov. 8 in
Concow. The Camp Fire has killed at least 77 people and destroyed more than
10,500 homes.
PG&E stock fell 4.7 percent to $23.26. The stock has plunged 51 percent
since Nov. 8 as investors try to assess the damages the company might have to
pay if it's held liable for the blaze.
Gold rose 0.2 percent to $1,225.30 an ounce. Silver inched up 0.1 percent to
$14.40 an ounce. Copper held steady at $2.80 a pound.
Bond prices rose. The yield on the 10-year Treasury note fell to 3.05
percent from 3.07 percent. The dollar slipped to 112.54 yen from 112.83 yen.
The euro rose to $1.1453 from $1.1412. The pound rose to $1.2855 from $1.2831.
France's CAC 40 gave up 0.8 percent and Germany's DAX slid 0.9 percent.
Britain's FTSE 100 slipped 0.2 percent. Japan's benchmark Nikkei 225 rose 0.7
percent and Hong Kong's Hang Seng added 0.7 percent. South Korea's Kospi gained
0.4 percent.
(BE)